I was on the flight. A young child got sick. We were due south of Keflavik and they announced the diversion. We flew 45 minutes north and dumped fuel along the way. After landing, an ambulance came and took the child and his family off. It took about 90 minutes to refuel and we arrived in Houston 2 1/2 hours late.

Here's a pic from the flight screen. I'm glad I snapped it when I did because even though they had the tail, nose and underbelly cameras on for takeoff in Frankfurt and landing in Houston, they turned them off for the diversion. The flight data screen with speed, altitude and estimated time of arrival was also switched off. That, and the entertainment system weren't reactivated until 20 minutes after takeoff from Keflavik.

It depends on the situation of the patient. If a doctor is on board, he can take care of the patient. If the condition is critical you need to divert and get some help for the patient. We can even call a medical helpline via Sat phone to get some assistance.
And I am sure all available sources were contacted and they came to the decision that a diversion would be best for the health of the kid.

Quoting wilco737 (Reply 10):
No, there is no insurance for it. The airline pays for it.

That's cool. I mean, in all other emergency situations, no matter if you're lost in some rainforest, on a cruise, everywhere else, and you need to be flown out, you pay for it. Sometimes even embassies let you pay if you want to be part of major evacuation programs in countries where i.e. political conflicts occur...